Ferreting Out Fakes

The growing problem of counterfeit IT gear finally gained crucial attention from U.S. law enforcement agencies after counterfeit goods started showing up in the U.S. Department of Defense supply chain.

According to a 2010 Government Accountability Office report, DOD had unknowingly procured counterfeit products, in part because of a lack of a departmentwide definition of "counterfeit" and a lack of databases for reporting counterfeit items. After a man purchased counterfeit Cisco Systems gear through a Chinese online seller with the intent of reselling it to DOD, U.S. agencies targeting sales of counterfeit IT hardware (including the Justice Department, FBI, Immigration and Customs Enforcement, and
Customs and Border Patrol) have achieved more than 30 felony convictions and seized more than $143 million worth of fake Cisco-branded products. Such counterfeit gear can put mission-critical networks at risk of failure.

For years, leading manufacturers have implemented measures to discourage counterfeiting and deter activities such as "gray marketing" (the unauthorized dealing in genuine branded goods resulting from diversion from authorized channels into the hands of third parties). Measures taken by many IT vendors have made it increasingly difficult to obtain genuine goods outside of authorized channels. This is where some gray marketers intentionally -- and some inadvertently -- began dealing in counterfeit goods. Today, unauthorized online retail and gray-market supply chains are the main contributors to the spread of counterfeit goods.

Purchase Protection

There are simple ways to reduce the risk of acquiring fakes. Buyers who purchase only from authorized resellers who themselves purchase directly from manufacturers or from their authorized distributors eliminate the risk of acquiring counterfeits almost completely.

The Alliance for Gray Market and Counterfeit Abatement is an organization committed to helping buyers protect themselves from inferior goods by knowing how to identify potentially non-genuine products. Buyers are advised to follow these guidelines:

• Be wary if the price is extremely low or significantly lower than what is normally offered by an authorized reseller. Remember, the bitterness of poor quality remains long after the sweetness of a low price is forgotten.
• If buying online, buy only from a trusted and verified supplier.
• Inspect packaging for damage, poor quality, repackaging or poor print quality.
• When in doubt, record a product's serial number or other unique identifier and verify directly with the manufacturer.

Don't just ask if a reseller is authorized -- get proof and verify it with the manufacturer. Unauthorized resellers will tell you anything you want to hear and some even provide forged documentation.

Taking the above steps can reduce the risk of acquiring fakes. If all buyers and resellers agreed to conduct transactions entirely within the authorized supply chain -- and take these steps to ensure goods are genuine -- they would jointly ferret out fakes from supply chains for good.